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As the dust settles from #GE2015, what might it all mean?

Everything that could have changed in British politics actually did change over the past twenty-four hours. We have, for the first time since 1992, a Conservative Government with a working majority and the major opposition parties almost hunted to extinction. Add to this the rewriting of Scottish political folklore and you have an electoral outcome that is truly outstanding.

Perhaps that is why the Prime Minister was so keen to emphasise a “one nation” approach in his immediate post victory speeches; he probably realises that the dissatisfied Labour/Liberal Democrat voters will be in some need of reassurance over the true intentions of a majority Conservative Government.

The financial markets have already responded positively to the election result with all of the sectors who would have been affected by a Labour Government enjoying rising share prices. The UK’s cost of borrowing also remains historically low, a factor that will crucially underpin low interest rates for mortgage payers.

So with all of this said why should we remain concerned over the next five year Parliament? The answer lies in the realisation that Britain’s political structure has changed forever. Regardless of a Conservative majority at Westminster we are all now living in a federal state, where the regions have potential primacy over the centre.

This is of particular relevance where Scotland is concerned, due to the strong Parliamentary presence of the SNP, but it will also be of relevance to Northern Ireland and Wales, whose First Ministers will be seeking equal access to the national budget. The Prime Minister and Chancellor will have to balance their expenditure priorities in the face of the demands from these authorities and the needs of the major English regions; many of whom elected Conservative MPs in favour of their Labour, Liberal or UKIP alternatives.

Achieving balanced economic growth in this context will have help to ensure Conservative hegemony over the coming decade in the Westminster Parliament. Failure to do so will have the effect of hardening nationalist votes or enable a recovering Labour Party to regain some purchase in the electoral landscape.

The way in which the new Government deals with EU will be of relevance here too. If it is too robust in seeking a renegotiation of our relationship with Europe then our UK regions may receive less development funding or diminished cooperation over trade. This means that the central plank of Conservative policy, “the in or out” referendum, may cause more trouble for the Conservatives than they envisage.

The need to achieve domestic political balance in a “federal Britain” while assuaging anti-EU backbench Conservative sentiment, may serve to provide the sternest test for David Cameron in the opening year of his new Government. This would also mirror the experience of Sir John Major who won an election in similarly surprising circumstances in 1992.

Just like Major did, Cameron will face regular tests of his narrow majority: on the details and approach to an EU referendum; on the political and financial settlement for devolved assemblies; the likelihood of a second referendum in Scotland too; and rebuilding a still fragile economy with continued austerity and cuts in public services.

Yes the Opposition is weaker so the challenges for this Government are likely to be self-inflicted. Cameron is stronger from his first term, and buoyed by this unexpected (by many) result, so he will do well if he avoids the mistakes of predecessors. Major was ultimately undone over Europe, Cameron should be wary not to do the same.